I'm the Founder and Managing Partner of Ironfire Capital LLC, which runs a tech-focused hedge fund and angel fund. I did a Ph.D. in Management at the Columbia University Graduate School of Business in New York, with a specialization in Strategic Management. You can follow me on Twitter @ericjackson, subscribe to me on Facebook, follow me on Sina Weibo, or Circle me on Google+. My email is: dr.eric.jackson@me.com

Why Siri Is a Google Killer

It’s now been a couple of weeks since Siri debuted as part of Apple’s (AAPL) 4S. The response from most people has been very positive.

However, in my opinion, Siri is tremendously under-valued. People see it as it is today, which is already the best voice recognition application in history. But people (including high-priced sell-side Wall Street analysts) fail to see where the puck is going for Siri. Siri will be vastly more improved in as little as 2 years from now. And the boundless number of applications using Siri will explode.

1. Siri works. Voice recognition has been the next big thing for 15 – 20 years. We still have these frustrating experiences when we call into check the balance of our bank account and have to shout in the phone 5 times in a row, because the application doesn’t recognize us. Siri is the best voice rec app ever — and it’s still in “beta.”

2. Siri has personality. Not only does Siri accurately recognize our voices but it has a personality to boot. It’s that personality which makes the app addictive because we start to feel over time that we truly have a personal assistant who is our friend.

3. Siri is hard to copy. For anyone who doesn’t understand voice applications, it’s easy to think that Siri will be easy to copy. It won’t. There are 2 parts to making a successful voice app: the voice rec technology which has improved a lot but is basically a commodity and the app itself, which is a combination of art and artificial intelligence. It’s that 2nd part that’s so tough to replicate and that’s why Apple bought Siri last year. It’s true Google has experience in the voice rec space and doing some simple voice apps but they do not have the personality and AI of Siri and that will be very difficult to copy — especially for a company that doesn’t sit at the intersection of the humanities and technology.

4. Siri helps own the customer experience for Apple. Dan Frommer and others have been talking about this for a long time. Siri is a new interface for customers wanting to get information. It used to be text-based input to their desktops. Then, it was thumbing it in to their mobile devices. Now, Apple is attempting to make it voice-based. They previously were attempting to Balkanize your data needs by training for you to do specialist searches for the information within apps on your iPhone. Now, they’re training you to rely for doing any task by leaning on Siri to do it for you. At the moment, most of us still rely on Google for getting at the info we want. But Siri has a foot in the door and it’s trusting that it will win your confidence over time to do basic info gathering. Siri can be potentially leveraged in other devices that Apple ships in the future like TV to become the primary way you interface with info you need.

5. Siri will vastly improve in the next 2 years based on all the data it’s amassing. This game is about where the puck is going, not where it is today. Many people only look at Siri as the application as it works today. Yet, the biggest advantage over any other voice application out there today, and the apps still to be developed, is the massive data Siri is now and will continue to collect in the next 2 years. We know after the first weekend alone, there were 4 million Siri-enabled devices out there probably collecting 1 – 2 utterances a day worth of data — all being stored in Apple’s massive North Carolina data center. All that data will allow Siri to get better and better. Think Siri has awesomely funny answers to your crazy questions now? Just wait two years. She’ll be even more your friend then, knowing you perhaps better that you know yourself in some situations. Gary Morganthaler – who was an early investor in Nuance (NUAN) and Siri — explains this in the video below:

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from the early 90′s it was all about the Desktop. Up until 2010 it was all about the Laptop. The next ten years will be about tablets with personal assistance. Dumbing down the masses. One byte at a time…..

It’s interesting to look back at this article 12 months later. Since then Google Now has come out and arguably beats Siri hands down. Perhaps most importantly it’s proving that the personality doesn’t have the lasting strength, it’s a novelty feature, the functionality and information are the true value points. Unfortunately for Apple, a lot of the data is coming from Google so they’ve got to get away from that if they want to kill Google.

Siri is a great innovation in the right direction but Apple is now behind Google in this space and Google is likely to offer their service for iOS soon. Where will this leave Google and our relationship with Siri? Tough to say. I’ve got a few predictions:

- While in theory Siri could be a Google killer it won’t be because it won’t advance fast enough to do so - Siri has unfortunately played a relatively small role in how people interact with their phones, in order to change that Apple needs to push hard but there’s a bit of a problem, Apple doesn’t generate any revenue from Siri - Apple will never to develop new models of revenue and adjust their business model if they want to head down roads like competing with Google on search, this makes the process unlikely

It’s no wonder that regardless of those controversies that APPL is having a difficult time with their revenues, they are able to stand up at the edge and able to come out a very effective alternative to become more productive. I’m curious if they have someone with mega mind inside.

It’s no wonder that regardless of those controversies that APPL is having a difficult time with their revenues, they are able to stand up in the edge and able to come out a very effective alternative to become more productive. I’m curious if they have someone with mega mind inside.